Pssst, Buddy—Wanna Buy a Client?

Running a successful law practice is all about getting clients. One way is by building a referral network, a frequent topic on Lawyerist. Another way is by advertising, such as in the yellow pages.

As traditional advertising methods wane, lawyers are getting excited by new methods of attracting clients through the internet. All those potential clients out there, yearning to find the lawyer of their dreams — all they need is a little encouragement. A little channelling. A system of connecting clients with lawyers. And lawyers will be eager to pay to have pre-screened clients sent their way – as long as they do not violate any ethics rules.

The general ethics rule is that a lawyer can not pay someone for referring a particular client or case. In fact, not only is a lawyer prohibited from paying but in most jurisdictions a lawyer cannot give “anything of value” to someone who recommends a lawyer’s services. No tickets to the Superbowl, no bottles of single-malt, not even a Starbucks gift card.

So unseemly. As draconian as that sounds, the practice of law has actually come a long way in its attitudes about advertising. Old school lawyers abhorred advertising as beneath the dignity of the profession. When SCOTUS declared in Bates v. Arizona (1977) that lawyers had a First Amendment right to advertise, then yellow pages ads, billboards, television commercials, local newspaper ads, little league jerseys, etc., all became fair game. None of these traditional advertising methods violates any rules on paying for clients because the advertisement is not targeted at a particular person with a specific legal problem. The fee is paid to the advertiser regardless of whether anyone ever reads the ad or contacts the lawyer. In short, the connection between the payment for the ad and the contact with a prospective client is attenuated at best.

Click here. Pay-per-click advertising, such as Google Adwords, presents a slightly more difficult question. In its simplest form, with Adwords an advertiser (such as a lawyer) targets the words that consumers might search for using Google (e.g. “ethics lawyer”). When someone searches using those words, the lawyer’s 4-line advertisement may show up above or to the right of the search results. The lawyer does not pay for the ad to appear but does pay when someone clicks on the lawyer’s ad and then is whisked away to the lawyer’s website.

So, the lawyer pays for clicks. Sounds pretty close to paying for each referral. But Google has no idea whether the clicker needs legal services, is just curious, or is bored at the office. Nor does Google guarantee a certain number of clicks or that the clickers will actually turn into paying clients. In the end, it looks more like targeted advertising than paying for clients.

Total Trouble? Several websites take targeting one step further and actually try to connect individual lawyers with individual clients. These on-line referral services, like Legal Match and Total Attorneys, invite prospective clients to submit information about their legal issues and then make that information available to lawyers who practice in the client’s geographical area. The lawyers pay for having access to these referrals.

Each service tries to avoid the ban on paying for referrals in its own way. With Legal Match, prospective client (PC) inquiries are routed to lawyer subscribers based on the lawyer’s practice area and location. The lawyer pays a flat subscription fee for the service. Presumably there are serveral lawyers for each location and practice area, so multiple lawyers are likely competing to respond to the same PCs (if there was only one lawyer, that would seem a lot more like paying for referrals). Several jurisdictions permit this type of service — Legal Match provides links to several ethics opinions.

Total Attorneys comes even closer to the line. Their referral program promises “geographical exclusivity” (only one attorney per practice area in a specific location) and “pay for performance” (the lawyer pays when Total Attorneys “produces results,” not a flat fee). The “performance” the lawyer pays for appears to be tied to new client contacts, not actual agreements to represent clients. Their scheme offended at least one gadfly who allegedly filed complaints against Total Attorneys lawyers in 47 jurisdictions for violating the rule against paying for referrals. So far, it appears that the complaints in about a half-dozen of those jurisdictions have been dismissed, with Connecticut being the most recent. Whether we will ever find out the dispositions of the other 40+ complaints remains to be seen.

A final oddity in this area is that many states’ ethics rules allow nonprofits, such as bar associations, to operate referral services which charge attorneys directly for taking cases referred to them or require the lawyers to share the fees they receive with the bar association. Apparently, when a nonprofit is paid for a referral, it’s a public service; when anyone else receives a payment, it’s a pox upon the public interest.

As technology continues to change our lives, lawyer advertising will likely continue to change as well. If you’re thinking of being the first on your block to try a new method of attracting clients through the internet, make sure you are buying advertising, not clients.

1 Comment

Finally, an even handed approach to the whole debate. While certainly not comprehensive, well written.

My fav line in the post: “Apparently, when a nonprofit is paid for a referral, it’s a public service; when anyone else receives a payment, it’s a pox upon the public interest.”

Astute observation because even though many bar associations “run” referral services, they do such a poor job of advertising them no one uses them!

I know of a large northeast coast bar association that almost gives away it’s lawyer referral service to members (about $150/yr) and STILL no one uses it because the bar doesn’t promote it enough to make it worth the $150!